DeLeo proposal favored locally over Wolf's plan

After House Speaker Robert DeLeo outlined a minimum wage hike last week that would peak at $10.50 in 2016, Cape Cod legislators and business leaders quickly praised the proposal as more palatable than a Senate version championed by state Sen Daniel Wolf.

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By C. RYAN BARBER

capecodtimes.com

By C. RYAN BARBER

Posted Mar. 17, 2014 at 2:00 AM

By C. RYAN BARBER

Posted Mar. 17, 2014 at 2:00 AM

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Minimum wage proposals

House Speaker Robert DeLeo proposes going from $8 to $9 this year, then $10 next year and $10.50 in 2016. He would raise the minimum wage for tipped employees from $2.63 to $3.75 in 2016. The Legis...

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Minimum wage proposals

House Speaker Robert DeLeo proposes going from $8 to $9 this year, then $10 next year and $10.50 in 2016. He would raise the minimum wage for tipped employees from $2.63 to $3.75 in 2016. The Legislature would have to vote on any future raises.

The Senate bill, championed by state Sen. Daniel Wolf of Harwich, raises minimum wage to $11 by 2016. Tipped workers would make half of minimum wage. Future increases are tied to the Consumer Price Index.

After House Speaker Robert DeLeo outlined a minimum wage hike last week that would peak at $10.50 in 2016, Cape Cod legislators and business leaders quickly praised the proposal as more palatable than a Senate version championed by state Sen. Daniel Wolf.

Speaking Thursday at a Greater Boston Chamber of Commerce event, DeLeo, D-Winthrop, proposed boosting base pay from $8 to $9 this year, $10 next year and to $10.50 in 2016. He would also raise the minimum wage for tipped employees from $2.63 to $3.75 by 2016.

Under the bill passed by the Senate last year, hourly base pay would rise to $11 by mid-2016, with tipped workers making half the regular minimum wage.

But the question of whether to index future increases to inflation created the widest gap between Wolf and fellow members of the Cape delegation.

The Senate bill, passed 32-7 in November, would tie future increases to the Consumer Price Index, while DeLeo's plan would require another bill to increase the minimum wage after 2016.

Wolf, a Harwich Democrat who spearheaded the Senate vote, said the minimum wage has not kept up with inflation since the late 1960s, when base pay had the buying power of $10.72 an hour today.

"All you need is to look at the last 45 years to understand that, because we didn't have indexing, the minimum wage has gone down 25 percent," Wolf said Friday. "Over time, it will diminish in value again. We should have learned that lesson from the past."

While no bill has been filed yet in the House, state Rep. Sarah Peake said Thursday that she is "far more with the House proposal" DeLeo unveiled. Rather than index future increases to inflation, Peake said, legislators could simply do the job of legislators and come back to vote when a change to the law is needed.

"I think that's appropriate," she said. "We're legislators in a legislature. We go to the Capitol to vote on policy decisions and changes and vote on statutes and amendments."

Freshman state Rep. Brian Mannal, D-Barnstable, said legislators would be shirking their responsibilities if they voted for a bill tying future wage increases to inflation.

"I'm more than happy to take another tough vote," he said.

For state Rep. Randy Hunt, a Sandwich Republican, the lack of indexed increases is the most important difference from the Senate bill. Hunt, a certified public accountant, said he would vote for a minimum wage hike — but not with automatic increases.

"It's another way for the Legislature to bow out of making difficult decisions, and I just don't like that," Hunt said.

"Indexing an item that is a big inflation driver to itself, essentially, is not a good policy," he added. "That's a big deal, because I don't begrudge anyone getting an increase in the minimum wage. It has been a long time. ... I'm not going to vote against the minimum wage."

If the House passes a minimum wage increase, as is expected, both chambers will conference in hopes of agreeing on a compromise that can move on to Gov. Deval Patrick's desk.

At $10.50, DeLeo's proposal is 40 cents higher than the $10.10 federal minimum wage proposed by President Barack Obama. Peake said that marks a "good starting point for the debate."

Wolf said the $10.50 target "doesn't even get the minimum wage back to where it was 45 years ago."

But with a ballot initiative proposing to raise the minimum wage to $10.50 by 2016 — like DeLeo's bill — and to tie future increases to inflation — like the Senate bill — the task of raising the minimum wage might fall to the voters.

If the House passes an increase without automatic increases beyond 2016, Wolf said, the ballot measure might just take the decision out of legislators' hands.

"I know that indexing is very, very important to them," Wolf said Friday about the petitioners.

Even if the Legislature votes to raise the minimum wage, advocates might still take their proposal to the ballot if the legislation leaves out indexing, said Deb Fastino, co-chairwoman of the Raise Up Massachusetts campaign to increase the minimum wage and guarantee earned sick time for workers.

"It's something we're considering. We haven't finalized our thoughts on that yet," Fastino said Friday. Raise Up Massachusetts saw DeLeo's proposal to raise the wage to $10.50 as a "victory" but has issue with the fact that there's nothing that links the minimum wage to the rising cost of living, she said.

Marie Oliva, president and CEO of the Cape Cod Canal Region Chamber of Commerce, said some businesses have been receptive to an increased minimum wage as long as it comes with reform to the state's unemployment insurance system and does not tie increases to inflation. The Senate has passed an unemployment insurance bill Wolf filed to stabilize rates and reward businesses for holding on to employees.

DeLeo has said that he wants to couple any minimum wage increase with reform to the rates businesses pay to fund jobless benefits.

"Bottom line, it's an improvement," Oliva said of DeLeo's minimum wage proposal. "Quite frankly, I think some type of increase is going to happen one way or another."

"Eventually, this is probably going to happen, so you need to work with your legislators to get the best possible plan for the business in the area," she added. "Sometimes if you see the handwriting on the wall, you have to compromise and say let's get the best result we can."